Ericsson faces lawsuit over profit warning (USA)Ericsson is facing a potential class-action lawsuit from shareholders over its recent profit warning. US-based law firm Coughlin Stoia Geller Rudman & Robbins started the suit in US District Court for the Southern District of New York on behalf of investors who purchased Ericsson stock between 11 September and 15 October this year. The complaint charges Ericsson and certain of its officers and directors with violations of the US Securities Exchange Act, alleging that the company issued materially false and misleading statements regarding its business and financial results. The suit alleges that Ericsson knew that it was experiencing declining sales in its networks due to lower sales of expansions and upgrades of mobile networks, sales in Western Europe were declining due to operator consolidation in several markets, and as a result, it lacked a reasonable basis for positive statements about the company’s business. The day of the profit warning Ericsson’s shares closed down 24 percent.
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